Moody’s downgrades Areas

Moody’s Investors Service said it downgraded the ratings of Pax Midco Spain (Areas), including the corporate family rating to B3 from B1 and the probability of default rating to B3--PD from B1-PD.

The agency also lowered the ratings on the senior secured credit facilities at Financiere Pax SAS to B3 from B1.

The ratings remain under review for further downgrade.

“Today’s rating action reflects the risk that Areas’ liquidity profile could materially weaken in the coming quarters if it fails to secure additional liquidity sources in the coming months including state-guaranteed loans,” said Eric Kang, a Moody’s vice president, senior analyst and lead analyst for Areas, in a press release.

“We also expect the coronavirus outbreak will have a protracted impact on the company’s revenue and profitability through at least 2022 given the large presence of the company’s food and beverage outlets at airports and our expectation that air passenger demand will remain severely depressed in 2020 and 2021, and will not see a substantial recovery before 2023,” added Kang.

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